In August, the price of butadiene rubber (BR) remained generally strong, driven by the "anti-involution" policy, tariff postponement, and concerns over natural rubber (NR) supply. However, insufficient fundamental support limited the price increase. It is expected that the market in September will tend to rise rather than fall, mainly showing a range-bound strong trend, with prices likely fluctuating between RMB 11,500 - 12,500/ton. Caution is needed regarding risks such as weaker-than-expected demand during the peak season and fading macro sentiment.
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I. August Market Review: Relatively Strong Prices, a Balance Between Drivers and Fundamentals
1. Price Performance: Overall Increase, with Limited Upside
Price Trend: In August, BR prices fluctuated with a relatively strong bias, and the monthly average rose slightly. The full-month price range was RMB 11,200 - 11,800/ton (a spread of RMB 600/ton). Taking BR9000 in the North China market as an example, as of the close on August 29, the price stood at RMB 11,700/ton, up 1.74% month-on-month from the end of July.
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Upward Drivers:
Policy & Macroeconomics: Sentiment around "anti-involution" continued to gain momentum, while the postponement of tariff implementation drove the overall upward movement of the commodity market and the rubber sector.
Correlated Product Linkage: Frequent heavy rainfall in major NR-producing regions raised market concerns about delayed NR supply. As a result, NR futures and spot prices increased, and synthetic rubber (SR) futures followed suit.
Short-Term Supply Support: In the first half of August, three sets of BR plants underwent maintenance (Maoming Petrochemical was temporarily shut down for 9 days; Qixiang Tengda and Yihua Rubber & Plastic each had a half-month maintenance period), which supported market sentiment.
Constraints on Price Increases: After the restart of maintenance plants, market supply became sufficient. Downstream buyers remained cautious about chasing higher prices, putting pressure on the upward movement of the spot transaction center.
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2. Supply-Demand Fundamentals: Rising Supply, Slightly Weakened Demand
Supply Side: The estimated average operating rate of domestic high-cis butadiene rubber (HCBR) plants in August was 70.97%, up 3.67 percentage points from the previous month (67.3%) and 12.16 percentage points year-on-year. Excluding long-term idled plants, the total idled capacity in the month reached 340,000 tons, with an estimated impact of approximately 12,600 tons on total output.
Demand Side: In August, the average operating rate of all-steel radial tire (ASRT) manufacturers in Shandong was 62.81%, down 1.07 percentage points month-on-month.
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The main reasons included: (1) maintenance schedules by some manufacturers at the start and end of the month, which hindered normal operations; (2) prolonged high temperatures affecting production, leading to a slight drop in daily output; (3) export orders provided some support, but daily production failed to fully align with capacity, keeping enterprises cautious in operations.
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II. September Market Outlook: Mainly Range-Bound Consolidation, Watch for Potential Risks
1. Price Forecast: Range-Bound Strength, Rising Price Center
It is expected that BR prices in September will fluctuate with a strong bias, with an overall range of RMB 11,500 - 12,500/ton.
Key supporting factors are as follows:Cost Support: The price of raw material butadiene has consolidated at a high level, and the spread between BR prices and costs remains narrow, providing a floor for the market.
Marginal Improvement in Supply-Demand: On the supply side, Yantai Haopu and Formosa Asahi Kasei (Taixiang Yubu) have planned 20-day plant maintenance (slightly reducing supply). On the demand side, expectations for the "Golden September and Silver October" (traditional peak consumption season for industrial products in China) overlap with continued downstream enthusiasm for stockpiling during the peak season.
Correlated Products & Macroeconomic Linkage: Typhoon impacts in major NR-producing regions persist, and potential under-supply of new NR may boost prices. Domestically, "anti-involution" sentiment remains; globally, expectations of Federal Reserve interest rate cuts will release liquidity, potentially driving BR prices to rise in tandem.
2. Supply-Demand Outlook
Supply Side: Xinjiang Land's plant resumed operations at the start of September. Combined with normal production at most other plants, monthly BR output is expected to increase, and the average plant operating rate may rise to around 74%.
Demand Side: The operating rate of ASRT manufacturers in Shandong is expected to see minor adjustments in September. Although concentrated export orders strongly support operations, the upcoming National Day holiday (end of September) may prompt some manufacturers to advance maintenance and production halts. Pressure from new capacity ramp-up remains, and overall operations will stay stable.
3. Risk Warning
Two major potential risks require attention:The actual performance of the "Golden September and Silver October" peak demand season may fall short of expectations.The fading of short-term positive macro sentiment may trigger a price pullback.
